Almirall, S.A. (ALM) Earnings Call Transcript & Summary

Good day, and welcome to the Almirall's Financial Results and Business Update H1 2021 Presentation. Today's conference is being recorded. At this time, I would like to turn the conference over to Pablo Divasson. Please go ahead, sir.

Thank you, Josie. Good morning to everyone on the call. Thank you for joining us to review Almirall's half year results. I hope everyone is safe and remaining healthy. As usual, you can find the slides to this call on the Investors page of our website at almirall.com. Moving to Slide 2. I would like to remind you that information presented in this call contain forward-looking statements that involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially. With that, please advance to Slide 3. Presenting today, we have Gianfranco Nazzi, Chief Executive Officer; Mike McClellan, Chief Financial Officer; and Karl Ziegelbauer, Chief Scientific Officer. Gianfranco will review the quarter's business performance and the growth drivers. Karl will provide you with details on the pipeline before passing to Mike to review the financials. Gianfranco will then make the closing comments before opening up for a Q&A session. I would like to pass you over to Gianfranco Nazzi.

Thanks, Pablo for the introduction, and good morning to everyone on the call. I am pleased to say the business has continued to perform well with a solid performance from the core business and the continuation of the good momentum from our growth drivers. We therefore are upgrading our core EBITDA guidance for 2021. Moving on to the growth drivers. We continue to see strong performance from Ilumetri, with excellent momentum from the anti-IL-23 class, where Ilumetri has gained market share and started to gain traction in France where we recently launched. Seysara has a rebound in TRx, with modest improvement in market share. Since we launched Klisyri in the U.S. in February, we have been encouraged with -- by good initial data, with positive feedback from dermatologists and patients. I will provide further details in the growth driver shortly. Overall, similar to many of our peers, we continue to be adversely impacted by COVID, particularly in term of assessing new patient. And as previously highlighted, there has been a softer hiring decision due to a wet spring in our key geographies. The late-stage pipeline is progressing well as we continued to work hard in advancing the pipeline to drive the significant potential there. We expect the readout of lebrikizumab Phase III trial in the second half of this year, and we continued to work with our partner, Eli Lilly, towards the 2023 European launch. Karl will give you more details on the recent European approval for Klisyri and Wynzora in France through a decentralized procedure. Lastly, we'll continue to look for opportunistic bolt-on licensing deals to reinforce our core business. A good example is the recent deal for efinaconazole, which we made this quarter. With that, let me enter into more detail about the growth drivers. So let me start with the performance of Ilumetri, which continued strong momentum. The slide show you the market dynamic in the IL-23 class in Germany. Here, you can see clearly that the anti-IL-23 are competing very well with the anti-IL-17, capturing 34% of the market share of new patient within the biologics, keeping it to head with the IL-17. Our view is a strong uptake of the class is a reflection of physicians' belief in the sustainable efficacy and reassuring safety profile. Within the anti-IL-23 class in Germany, Ilumetri has a strong market share, which has increased to 28% within the class. There are good reasons for this trend. While competition within the class is strong, Ilumetri is a compelling product profile as the first anti-IL-23 to deliver a data set with a consistent long-term safety profile through the 5 years. Very good tolerance, delivering maintained control for psoriasis patient and easy to use as a key attribute. As you can see here, Ilumetri has had a very good performance, with strong quarterly momentum and impressive year-on-year growth, resulting in more than doubling of net sales growth and achieved EUR 20 million this quarter. Year-to-date Ilumetri is now our #1 product. We are pleased with the uptake of recent country launches like in Spain, Italy, Austria and Switzerland, which are starting to increase their contribution to accelerate the overall growth, supported by long-term data, confirming the excellent efficacy and safety profile. In Germany, we continued to see strong growth momentum, gaining new patient share. Since the launch of Ilumetri in France, a key growth market, we continued to see positive initial uptake with a good quarter of solid growth, achieving more than double quarter-on-quarter growth. And we are on track on our expectation toward a meaningful contribution by this summer. These are very good trends showing this quarter, and they validate the potential of Ilumetri in Europe. We strongly believe this is due to the profile of the product having a quarterly dosing regimen and a cost-effective price, which continued to support the growth of the product in the winning class. Now let's take a look at Seysara. Our strategy remained the same to rebuild TRx and increase market share as the sales rep increased the sale-to-face interaction with physician when we see the normalization from COVID. As you can see, the second quarter has continued to rebound in TRx since the start of the year. And more importantly, we saw an improvement in the market share. We will continue to dedicate resources to further differentiate Seysara based on the microbiology label, which is an important factor that we are able to leverage with physician as it really differentiate the product from the other older generics that continue to dominate the market. We are focusing our efforts on increasing market share and market access as we continue to increase the commercial coverage plan with several PBMs. Our strategy for assets is making good progress as we focus on increasing our interaction with prescriber than what actively prescribed in pre-COVID. And we should be able to provide more details in the coming months. As previously communicated, Seysara has been heavily impacted by COVID. These have required us to rethink the potential of Seysara in the U.S. market, and we are now revising our sales, our peak year sales from $50 million to $75 million due to higher rebate expectation and lower market access. We think this is a very good product with good potential, and we have an execution plan in place for a build in the TRx and the market share in the months to come. Now let's move to Klisyri, which we launched in the U.S. in February of this year. We are pleased with the initial uptake of the product given the current environment. The feedback from both dermatologists and patient have been very positive, with comments on the strongly needed benefit for patient by addressing the tolerability limitation of the existing treatments. We continued to see the product gain penetration on the atopic -- on the actinic keratosis topical market offering a robust product profile, which represents a significant step forward in the treatment of actinic keratosis, due to a short treatment protocol and once-daily application for 5 days, proven efficacy and good safety profile. Our expectation is that we should be able to gain a good level of market share as dermatologists are seeking new option for treatment of the actinic keratosis patients. We are working hard on our strategy to gain payer coverage to drive safe volume. We are in active discussion with multiple PBMs to increase the commercial coverage in the second half of this year. Asset is making good process, and we should be able to provide more updates in the coming months. Our promotional efforts are on the high-decile prescriber, which should be reinforced the acceleration of the performance of Klisyri. And we will continue to support the launch in the U.S. as well as prepare the launch in Europe that is expected on the second half of this year. Finally, I would like to welcome Dr. Karl Ziegelbauer. As you have seen from our June announcement, we are very pleased to have had to our internationally experienced leadership team with the appointment of Karl as the new Chief Scientific Officer, who start at Almirall earlier this month. Karl is a recognized industry leader and is bringing with him 3 decades of leadership experience in drug discovery in international markets like Germany, Japan and the United States. And he spent almost all of his career by a pharmaceutical. Karl is a great fit for the company, and he has the right profile to continue to execute on our R&D strategy, to develop the early-stage pipeline with highly innovative medical dermatology products. Karl will utilize his experience in evaluating and scouting out new collaboration with biotechs and academia as well as the ability to drive the development of our own internal pipeline project. With that, I pass to Karl to update you on the pipeline.

Thank you, Gianfranco. Please to meet you all, and I look forward to meeting you in person in the near future. Here, you will see that we have made excellent progress in advancing the pipeline to drive significant potential. The slide is an important one in our view because it enabled you to see how we are moving forward in executing our strategy and transforming our portfolio with innovative products in medical dermatology. Gianfranco has already discussed the successful launch of Klisyri small field in the U.S. We have now received approval in the EU and are now preparing for the launch, which we expect in the second half of this year. In parallel, we are preparing the new launch of Wynzora following approval in France. This will be a decentralized procedure, which requires approval country by country, with an expected launch at the end of this year or early next year. Furthermore, we have lebrikizumab, which we are very excited about, this opportunity, and we continue to work with our partner, Eli Lilly, on the Phase III headline readout expected in the second half of this year. I will elaborate on this shortly. For Seysara China, we will work towards the start of Phase III trials as planned, having already received the acceptance of our clinical trial application. We think this is an interesting opportunity, and we'll update you on how we go to market as this develops. And finally, following from our announcement earlier this month, we have entered into a license and distribution agreement for the topical formulation of efinaconazole in Europe. Efinaconazole is another triazole antifungal compound. The product is already approved in other countries. And the plan is to use as much as possible existing studies, for example, the U.S. Phase III, to get approval in Europe. We are already working on preparations for a planned pre-submission meeting with regulatory authorities, and we'll keep you updated on the feedback from that meeting. As you can seen, we have made excellent progress on the pipeline, and we are on the right track to strengthen our leadership position in medical dermatology, whilst we continue to look at external opportunity within our key markets which complement our portfolio. With that, I would like to turn next to our most exciting opportunity we have with lebrikizumab in atopic dermatitis. Lebrikizumab is a potentially best-in-class anti-IL-13 antibody, which is currently in Phase III development for the treatment of moderate to severe atopic dermatitis. Atopic dermatitis is a disease where there is still a significant unmet medical need. We are working closely with our partner, Eli Lilly, towards the next catalyst, which we estimate in the second half of 2021 for the top line result of the 16-week induction phase. The program includes 2 identical Phase III studies designed to confirm the safety and efficacy of lebrikizumab as monotherapy in patients 20 -- 12 years, sorry, and older. The core primary endpoint for the ADvocate 1 and 2 Phase III studies are: number one, the percentage of participant with an investigated global assessment score of 0 or 1 and the reduction of more than 2 points from baseline to week 16; second, the percentage of participants achieving an Eczema Area and Severity Index 75. This means more than 75% reduction from baseline in the EASI score at week 16. We will then have in the first half of 2022 the 52-week maintenance and dosing data that is required for submission, which puts us on track to launch in 2023. Whilst we wait to see the result of the Phase III data, if we can confirm a profile like that we have seen in Phase IIb, we think we have a very competitive product. Our belief is that lebrikizumab will deliver reliable skin efficacy, superior itch relief and favorable safety profile. In addition, lebrikizumab may have convenient once-monthly maintenance dosing as an other potential competitive advantage, thereby offering patients living with atopic dermatitis access to a truly differentiated therapy, with the potential of being best in disease therapy. Now thinking from a patient perspective, the atopic dermatitis market is expensive, growing and diverse, where there remains, as mentioned, a large unmet need to provide new options to patients. The patient numbers with moderate to severe disease are large and growing. And despite the launch of dupilumab, the penetration of biologics is still extremely low. We believe there is a clear need for new and differentiated therapy. And with lebrikizumab in our pipeline, a potentially best-in-class anti-IL-13 antibody, it gives Almirall a unique opportunity to help these patients live a better life. With that, I will pass over to Mike for the financial review.

I'd like to take you through the financials, if we go to Slide 16 now. As Gianfranco mentioned in the introduction, we've seen a solid first half, with healthy growth of the core business. Core net sales increased 8% and core EBITDA increased 40% year-on-year, driven by positive contribution from the growth drivers and a strong EU dermatology performance. The contribution of higher-margin products has increased the gross margin ratio to the 69.5% in the first half of 2021. In terms of OpEx, SG&A slightly increased as expected, supporting the recent launches, and the overall outcome is a strong growth of our core EBITDA year-to-date at EUR 125 million. We've also had very strong operating cash flow, reaching EUR 110 million year-to-date. This has enabled us to continue to delever, resulting in a very healthy balance sheet as we finished the quarter at 1.4x net debt-to-EBITDA ratio. We have recognized some intangible impairments in the first half of 2021 amounting to roughly EUR 100 million relating to Seysara, the U.S. legacy portfolio and the Bioniz option. Seysara and the legacy brands have been heavily impacted by COVID. And we've also revised our view in respect to the peak sales and growth potential for Seysara, as mentioned by Gianfranco earlier due to the higher expected rebates and copay assistance needed to drive the covered portioned of the business. Let me now move on to give you more detail behind the numbers. On Slide 17, you can see the dynamics of the core business year to date. The European dermatology business has had a very strong performance, while there's been a slowdown of our other products in the EU as we're seeing a softer allergy season due to the wet spring, in addition to the low cough and cold season we mentioned in Q1. The U.S. business is still seeing a negative impact from COVID, similar to many of our peers, particularly in terms of capturing new patients. As previously communicated, we have now essentially annualized the initial generic impact of Aczone, but we will expect to see additional competitors in the second half, which will erode most of the remaining sales as we move forward. Overall, our portfolio has limited patent expiry risk going forward in terms of the -- except for the near-term potential generic effect on Efficib in Spain, which will be impacted in late 2022. It is worth pointing out that the Q2 2020 was affected by destocking following a very strong Q1. While we have seen some improvements, COVID continues to influence the business. And while we continue to monitor the situation regarding future developments, such as the impact of the delta variants or other mutations, we will have to see how it plays out in the second half. Looking at the year-to-date dermatology sales. We registered a strong performance in Europe, driven by the growth of Ilumetri, as well as strong trends for our Ciclopoli franchise. The U.S. business continues to be impacted by COVID, with a slower uptake of new launches and softer demand in some areas. However, we have seen some improvement in recent months. We anticipate COVID to continue to influence the business throughout 2021. While COVID-related restrictions are already easing in the U.S., we anticipate it will take until the fall to see patients visiting their doctors at a normalized rate. The other U.S. products were also affected by higher rebates and returns in 2021. Moving on to Slide 19. If you look at the core sales evolution, and here are a couple of things I'd like to pull out for you. The existing portfolio net sales increased around EUR 20 million for the first half, aided by the Q1 flat roll sale. And as you can see, the growth drivers had good contribution during the year, driven by Ilumetri and Seysara, but the rest of our U.S. business took a hit of nearly EUR 10 million year-to-date. On to Slide 20. To continue with our focus on the core business, I've already highlighted the key factors on sales performance. So let me run you through the rest of the P&L. We continue to invest in our recent product launches, with SG&A increasing in line with our expectations as we previously guided, especially comparing to 2020, where Q2 had a very low spend due to the COVID lockdowns. While we continue to invest in R&D, this quarter had lower spend related to COVID delays. We expect R&D spending to pick up during the second half, as we will be starting the Phase IIIb reimbursement trials for lebrikizumab as well as the large field trials for Klisyri. Overall, the core sales increase and flat overall spending led to our core EBITDA increasing 40% from last year, reaching EUR 126 million for the first half. The reconciliation at the end of the P&L as the deferred income which was EUR 10 million year-to-date and the other income of roughly EUR 1 million from AstraZeneca. On Slide 21, as we continue down the P&L, the normalized net income, excluding the impairment impacts, is slightly down versus last year, finishing the first half with a normalized earnings per share of EUR 0.32 per share. If we go on to Slide 22, looking at the balance sheet. There are quite a few comments provided on the slide and I've talked about the impairments. So I'll highlight just one of the most important factors for us. We have a very healthy balance sheet and finished the quarter with a leverage of 1.4x net debt to EBITDA, which gives us the flexibility in the current environment and also allows us to do additional licensing and in activity if we see things that can add shareholder value. I'd like also to mention that we're looking at different ways that we could refinance the EUR 250 million convertible bond that matures in December this year. The credit markets for companies with our credit rating remain robust, and we're reviewing the best option. We will update you once we have more details likely to be in Q3 of this year. Slide 23. Let's take a look at the cash flow statement. We delivered a very strong operating cash flow, generating EUR 110 million. We've had a negative change in working capital, which is mainly related to seasonal increase in accounts receivable that we will see normalize in the rest of the year. We have made key investments in the first half, including the milestone for the U.S. commercial loans of Klisyri, as well as the upfront costs for the acquisition rights in Europe for Wynzora. The divestments listed refer to milestones and royalties collected from AstraZeneca. These have been classified as investing activities due to the reduced focus in our operations. During Q2, we also had the disbursement of the dividend. A gross dividend was paid of EUR 0.19 per share to our shareholders who elected to receive the dividend in cash, while the majority elected the scrip dividend. The 2020 dividend was paid later in the year due to COVID delays. And finally, to conclude the financials, we are upgrading the core EBITDA guidance to a range of EUR 195 million to EUR 215 million, a roughly EUR 5 million increase of the range from our original guidance set in February. This is aligned with the strong operation performance as the core business continues to perform well, driven by our recently launched products and the European dermatology business. The main swing factor for us ending in the lower part of the revised range is the risk of further COVID impacts, which we will monitor closely to see how the delta variants and other mutations develop. With that, I'll hand it back to Gianfranco to conclude the presentation.

Thank you, Mike. And to wrap up, this has been a strong year-to-date performance, demonstrated good momentum for our European dermatology business and an improving U.S. business. We expect the positive contribution from the key products will continue to improve the core net sales and the core EBITDA. And we therefore are upgrading our core EBITDA guidance. As we highlighted in the presentation, we are progressing nicely with our existing innovative pipeline, focusing on unlocking the significant midterm potential of our pipeline, with important catalysts into 2021. We are focusing on strong execution in Europe and preparing the business for these important launches. The growth of the core business will come from the increasing contribution from the current and future launches, where we have low patent exposure. Additionally, we continued to review opportunity for potential bolt-on and in-licensing opportunities that complement our portfolio and can generate sustainable value for the future boost of our growth. This year, we have made good progress by acquiring 2 products: Wynzora for the psoriasis and efinaconazole for the onychomycosis. This product has a clear strategic fit where we'll be able to leverage our existing infrastructure. With that, Pablo, I hand back to you for the instruction on the Q&A.

Thank you very much, Gianfranco. Josie, to you for the Q&A, please.

[Operator Instructions] Your first question for today is from the line of Jo Walton from Crédit Suisse.

A few questions, please. On the U.S., now that you've cut your expectation for Seysara sales to EUR 50 million to EUR 75 million, I wonder if you could tell us how urgent it is to get another product into that U.S. dermatology business to really justify the marketing support that you need particularly behind Klisyri. On Klisyri itself, I wonder if you could tell us what level of market access you would be comfortable with by the end of the year, given that you're not happy to give us a level of market access and formulary acceptance at the moment. On lebrikizumab, I wonder if I could push you on when we could get the next set of data. If we're going to get the 16-week data in the second half of this year and the 52-week data in the first half of next year, presumably, the 16-week data is really a third quarter event and something that we should be getting fairly soon. And I wonder if you could tell us, for lebrikizumab, whether you think we really need to wait for that 12-month data to fully understand the competitive position of the product, because I assume that particularly, the monthly dosing is very important to how you think about the pricing. And a final question, if I could, just to check and see what sort of marketing spend going forwards. You obviously were able to control it and -- in the first half of this year. In order to get anywhere close to your peak sales for Seysara, do you have to really ramp that up again in 3Q as you go back to the back-to-school season.

Thank you, Jo. So let's start with Mike that is going to answer the first part of the question. And then I will jump on the Klisyri, and then we are going to have Karl discuss about lebri and then we can close on the marketing spend with Mike. Mike, please?

Yes. Thanks, Jo. So in the U.S., I think between the opportunity for Klisyri and Seysara, we still have quite a room to run and to keep our sales forces occupied. We will always, of course, look out into the market to see if there's other things we can add to the portfolio. But it's got to be something that fits in the right spot, and it's something that we feel we can really be competitive in. I think we'll probably shy away from the multibillion-dollar biologic-type asset deals just because we don't have really the size and strength. So we have to find interesting little bolt-on assets that we can add to the U.S. business. But I think we've got plenty of room to continue to grow. The U.S. business is profitable. So it's not like we're in a panic situation there. We just need to make the most out of Seysara and Klisyri, and those 2 will keep our sales force busy for the immediate short term.

Yes. On the Klisyri assets, you were asking what is the percentage that we have today. So to give you the number today, we have 11%. And we are planning to double this number by -- in the next few months, by year-end. So we are quite confident that the sales is going to uptake in the second half of the year. Karl, on lebri?

Yes. On lebrikizumab, what we will receive in the second half of 2021 is the 16-week data. And this is mainly the percentage of patients that have a reduction in the IGA score and the percentage of patients that achieve the EASI 75 score. Those patients that are responder continue then on the maintenance part. And those readouts will be available in the first half of the next year, including also some information then on dosis. And those data are needed actually then to file with regulatory authorities that we will then do with our partner next year to then looking forward to a launch in 2023.

Yes. When it comes to the marketing spend, as we advised earlier in the year, we do expect marketing spend to continue to increase this year versus last year. We've got plenty of opportunities. And it's not just related to putting more money behind Seysara. That's, of course, one thing that we continue to invest in. But we'll be launching Klisyri in Europe. We'll be gearing up for the Wynzora launch. And we're now starting to look at even some pre-marketing activities for lebri. So as we go through the rest of this year and to next year, we'll continue to invest robustly in our SG&A spend because we really see great opportunities in the midterm to drive the product portfolio. As I mentioned earlier, we'll also see a little bit of uptick in R&D spend in the second half as we will be getting into the lebrikizumab Phase IIb trial. So if you look towards 2022, and we'll give you more update, of course, beginning next year, we still see robust opportunity to grow sales, but we are going to need to invest in SG&A and R&D to fuel the future pipeline.

And can I ask whether you participated in going for Winlevi? We see that, that was in-licensed by Sun today for not very big upfront.

Jo, we don't comment on assets that other people have licensed. So I can't really answer that one.

Our next question for today is from KC Arikatla from Goldman Sachs.

I have 2, please. First one, as you do a postmortem of Seysara, what have your learnings been, please? Would you say that the lackluster performance there is due to poor product selection or is it difficulty in making inroads in the competitive U.S. derm market? And how does -- how do all these learnings shape your future M&A strategy? That's the first one. The second one, on Ilumetri. Can you give the sales split between Germany and other regions? And if you could just update us on the geographical expansion plan for the product in Europe.

Okay. Thanks, KC. I think these are both financial questions so I'll take them. I mean, if we look at the postmortem on the initial view of Seysara back in 2018 when the acquisition of the Allergan business was made versus what we're seeing in reality now, I would call out 2 things. One, of course, nobody knew we would have a COVID-type situation that would really impact the access to physicians and patients, especially in a product, there was a new launch and really needed to gain new patients. As an acute medication, you need to continue to gain new patients. It's not like something that carries over on a patient basis for a long time. I'd say the second is the market access/rebates have hardened quite a bit from that initial view. What we're seeing in the U.S. market is there is a lot of money being spent in oncology and biologics in rare diseases. And the payers are squeezing quite hard those classes where there is a generic competition. And I think what we've learned from this and what we'll take into future BD and licensing and M&A is that you really have to have something that has an efficacy advantage as well as other advantages and has a very strong profile to get past the payers in the current U.S. market because they are seeing a lot of cost pressure and they're putting it on the places that they can really squeeze hard. And unfortunately, we've seen that in Seysara. The second one, when it comes to Ilumetri. Germany is still more than half the sales, but the rest of the countries are starting to pick up pace. We see as we move forward that we're going to see very good growth in France, Italy, Spain and we're starting to look at future rollouts. I would say in the next 2 or 3 years, we will look to see what we can do in the Nordics, depending on reimbursement, and we'll also look to see how we can start rolling Ilumetri out into the Eastern side. So lots of potential still, Germany being the main growth driver right now, but we're starting to quickly start to pick up in some of the other markets.

[Operator Instructions] Our next question is from Peter Welford from Jefferies.

I've got 3 -- or 4, actually, sorry. So firstly, just on lebrikizumab, just following up on Jo's question and trying to be a bit more specific. I guess what we're sort of wrestling with here is that if the maintenance endpoint is 36 weeks after the primary endpoint of the induction phase and the maintenance endpoint will -- is going to be met and the headline data available in the first half of next year, then just taking 36 weeks of that time suggests that the induction data for lebrikizumab has to be in the third quarter, just to allow for 36 weeks until the final maintenance data. So I guess, is there going to be a delay in the presentation of the announcement of those induction data due to you working with Eli Lilly? And perhaps you could tell us who it is who controls the press release for the induction data? Is it you or Lilly? Or should we -- are we correct in thinking that those data should be coming in the third quarter? Secondly then, just on Klisyri. Thanks for giving us the access at the moment. Just curious, if you look at the prescriptions you've seen to date, are most of those, as far as you're aware, from commercial covered lives? Or are you seeing a proportion -- a meaningful proportion of out-of-pocket use of the product in your initial launch to date? Thirdly, just on efinaconazole, I wondered if you could just, I guess, explain to us how this product, do you think, is differentiated, given I think you had an onychomycosis product in the past, terbinafine in Europe, but decided to out-license that. So I guess why now in-license this asset? What is it do you think that makes this more attractive versus the terbinafine you had in the past from Poland? And then sorry, fourthly, just on Efficib, I think you said that went generic in Spain late '22. Is that also true for Tesavel? I guess if we look at the Efficib/Tesavel line, should we assume that entire line basis generics late 2022?

Thank you, Peter. So we...

Yes, I can start with lebrikizumab. So the ADvocate 1 and 2 studies design implies an induction phase of 16 weeks. And the top line result, as mentioned, we will present in the second half of this year. And we will closely align with our partner, Lilly, on everything we will present and update you as soon as those data are available. After those induction phase, there is a maintenance phase of 36 weeks, which brings them to week 52, which includes, as I said, also different dosing schedule. And once those data are available, again, we will update you. And these are the data that are required to submit the trial for regulatory approval.

Thank you, Karl. So I can pick up the Klisyri one. So Klisyri today, we have almost 1,000 TRx out of a market that is between 90 to 100. So that's where our market share is, 2%. In term of commercial, we have 60-40 -- 60 -- 60% and 40% ratio. So 60% of the commercial one. You were asking also about onychomycosis and why we bought this product. I think the 2 product between JUBLIA and Ciclopoli, they are complementing very well. Ciclopoli is an OTC product, is for the mild onychomycosis, while JUBLIA is an Rx product for the more severe one. So the 2 can complement very well. We are very happy with Ciclopoli performance year-to-date. It's growing 16% year-on-year. And we truly believe that the 2 of them can really perform in a very nice way our portfolio. So Mike, you want to comment?

Yes. So the generic competition does relate to Tesavel as well. So that whole product line will face potential generic competition in Spain. I remind you that typically in Spain, when you have a generic, you see a large price decrease and you have at least the ability to try to continue to drive the volume. So we'll keep updating as we get closer, but we do expect to see that late in 2022.

Your next question for today is from Alvaro Lenze from Elantra Equities.

Most of them have already been answered. I just wanted to know whether is there any read across from the performance of Seysara in the U.S. and your potential launch in China and how do you see the market and how do you see competition and what the -- maybe you can guide us of what the market opportunity is there in China.

I can take both. So Seysara today, we can start with access. So Mike was mentioning before about the lack of access. We have a clear plan in order to improve it and to arrive by the year-end at 50%. Today, we have 40%. But not only this, we are working on a very focused action plan, starting from the segmentation and targeting. We just completed an ATU survey to better understand the physician prescribing behaviors. And for that, we are going to change and we are going to adapt also our message. So I feel confident that the team has the hand how to manage and to reverse the performance for Seysara. But as I said, and as we said at the beginning, COVID truly impacted a lot and that is what the second cause. In term of China, Karl was mentioning before that we are going to start on the second half of this year our Phase III trial. And the potential in China, just to give you an idea, is 13, 1-3, million patients with acne. So we truly believe that the market can be a good one. And in the next few months, we are going to start working on what is also the perfect go-to-market model in order to tackle this very important market. Thank you, Alvaro.

There are no further questions waiting. So I'll hand the call back to Pablo Divasson for closing. Thank you.

Thank you, Josie. We are now going to close our Q&A session. And with this, we will complete our conference today. We want to thank you for your participation. You may now disconnect.